Dubai Chamber study indicates strong growth in the UAE's tourism sector 

(MENAFN - Emirates News Agency (WAM)) A recently-released Dubai Chamber of Commerce and Industry study reveals that the UAE tourism sector has shown strong growth and has intensely contributed in promoting the country as a world tourism hub.

The study released on the sidelines of the launch of the 19th edition of the Arabian Travel Market which is attended by 2,400 companies from 87 countries indicates that the year 2012 augurs well for the growth of the tourism sector in the country.

Based on information derived from Business Monitor International (BMI) UAE Tourism Report Q1 2012, the study states that the UAE tourism sector is structured into tourism hospitality services (mainly hotels and restaurants), tourism transportation (mainly airline, airport and related travel services) and tourism infrastructure (shopping malls, shopping festivals, golf-course and infrastructure for sporting events like cricket, racing and football).

According to the World Travel and Tourism Council (WTTC), in 2011, 74.7% of UAE tourism spending was on leisure activities, while about 25.3% was on business activities. With UAE's strategic location and position as a tourist hub, foreigners contributed a large portion, about 78.5% in 2011, to the UAE's overall tourism spending.

Sector outlook and growth opportunities After buoyant historical growth, the UAE tourism sector is expected to see strong growth in the future. According to World Travel and Tourism Council (WTTC) forecasts, the UAE tourism sector is expected to experience annual real growth of about 6.5% during the period 2011-2021, with employment expected to also grow by an annual real growth rate of about 4.1% during this period.

The study further states that inbound arrivals from the traditionally important markets including the Middle East, Europe and the Asia-Pacific region are expected to show strong growth in 2012. However, it is also significant that arrivals from new markets, such as Latin America and Africa, which at present, contribute a small portion to the overall number of tourist arrivals are also expected to experience robust growth. Increased tourist flows from new markets indicate the UAE's success in diversifying the sources of its tourist arrivals.

Also, growth of tourist arrivals from emerging economies such as Asia-Pacific, Latin America and Africa is also important from the perspective of consumer expenditure, as the wealth of residents in these regions is expected to experience significant growth overtime. Also an important emerging prospect could be the growth of tourist flows from the world to other parts of the Middle East and North Africa (MENA) region, including places like Iraq and Turkey, for which Dubai can serve as a hub for global travellers.

Creating packages where visitors can combine business travel with leisure can perhaps serve to increase the average length of visitor stay, from its current level of about three nights. Success in helping the sector improve its competiveness would involve improving cooperation between tourism related entities, including tour operators, hotels and organisers of major sporting and shopping events. Other policy measures could include improved quality standards and a long-term strategy for the tourism sector. These measures could further contribute in improving the overall efficiency of the sector and could help realise long-term benefits from the opportunities presented by the growth of tourist flows from emerging economies.

Challenges facing the UAE tourism sector Important challenges facing the UAE tourism sector includes competition from other destinations, the need to offer a diverse range of tourism activities which can appeal to visitors of different ages and backgrounds, collaboration within the sector and the need to develop a long-term strategy for the sector.

Another important challenge is the short-length of stay by foreign visitors. Encouraging these visitors to stay longer, thereby spending more money in the UAE is important for the further development of the tourism sector.

Measures to meet these challenges could include development of a long-term strategy to help the sector's growth, attracting more business travellers who can spend more time and money, helping business travellers combine leisure with business travel and more cooperation between the government and the private sector.

Encouraging different tourist activities, such as eco-tourism could help to create a more sustainable tourism sector and could also help to improve the environment. It could help to attract a niche of travellers interested in more environmentally friendly tourism. Diversification of tourism flows into new markets, a strategy that has been successful given the growth figures highlighted in table 1, should also help the Dubai and UAE tourism sectors to continue to be the engine of future economic growth.

Conclusion and government initiatives The UAE tourism sector therefore has strong prospects for growth. A proactive policy on the part of the tourism sector businesses and the government to attract visitors from new potential growth markets of Turkey, Indonesia, Mongolia and Central Asia could help further strengthen the growth of this sector. Other measures could include more regional cooperation, with tourism agencies in the GCC and MENA regions, to position Dubai as a gateway for tourism travel to these countries from the rest of the world.

In its conclusion, the study states that Dubai's strategic location and strong air and transport infrastructure have given it the ability to project itself around the world as a hub of tourism. A sound long-term strategy to exploit future opportunities, and enable more private sector and government cooperation, could further cement its position as the world's tourism gateway to Asia, Africa and the Middle East.